Profitability returns to hard-drive industry

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Profitability returns to hard-drive industry

Revival being driven partly by the consumer-electronics market

Jonathan Cassell

Tuesday, January 08, 2008

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The computer market is propelling HDD shipments also, with enterprise secondary-storage external drives experiencing strong demand. The threat from Solid-State Drives (SSDs) using NAND flash instead of traditional rotating media has not stalled shipments or profitability in the HDD industry.

In terms of HDD revenue in the fourth quarter, iSuppli is estimating it to be around $9.3 billion; a slight dip in industry revenue in prior quarters has been overcome by firmness in price and increased supply of hard drives to both the compute and consumer-electronics segments. Moreover, there is an allocation mode in the industry for specific types of hard drives.

iSuppli predicts conditions in the HDD market will remain robust in the fourth quarter, with shipments rising 6.9 percent to 147 million units. The HDD industry has worked its way out of the major challenges it faced in 2005 and is rapidly growing, confounding experts who predicted the slowdown of this industry. Profitability for the two major HDD makers, Seagate and WDC, is expected to rise in 2008.

The author is the Editorial Director and Manager, Public Relations, iSuppli

©CIOL Bureau

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